We Need More Three Mile Islands

As tech companies reboot nuclear energy, the site of the famous meltdown represents both the industry’s demise and its rebirth.

Jane Fonda isn't a nuclear expert, but she played one on TV. In the 1979 film The China Syndrome, Fonda portrayed Kimberly Wells, a vivacious news reporter who discovered a cover-up at a nuclear power plant. The conspiracy involved the possibility of a meltdown that could "render an area the size of Pennsylvania permanently uninhabitable." 

The movie's timing and location were both impeccable. Twelve days after Fonda's film hit theaters, a reactor at Three Mile Island (TMI) in central Pennsylvania partially melted down. The accident resulted from "mechanical malfunctions…made much worse by a combination of human errors," according to a federal post-mortem report.

There were no documented fatalities, illnesses, or injuries; TMI suffered more from poor emergency-procedure planning, haphazard public relations, and hyperbolic media meltdowns than from the actual meltdown itself. But the incident was cannon fodder for the anti-nuclear movement. Fonda, an avid anti-nuke activist well before the accident, knew that she and her comrades commanded the zeitgeist. "You know the expression 'We had legs'?" she later said. "We became a caterpillar after Three Mile Island."

The ensuing fearmongering campaign effectively killed nuclear energy in the United States. Construction of new nuclear power plants significantly tapered off. After the Chernobyl meltdown of 1986 in the Soviet Union, U.S. nuclear construction came to a standstill. Since 1986, only a few reactors have been built in the U.S., including the recently completed units 3 and 4 at the Alvin W. Vogtle Electric Generating Plant in Georgia. This is significantly less nuclear capacity than we should have, even before considering the rise of AI.

But now nuclear power is on the verge of a comeback, with Silicon Valley leading the way.

Tech Companies Go Nuclear

Artificial intelligence (AI) devours electricity. A ChatGPT search requires about 10 times more watt-hours than a traditional Google search. Training GPT-3, a large language model that uses AI to generate text, requires about 1,300 megawatt-hours (MWh)—the same as the annual energy consumption of 130 households.

Our grids will need an additional capacity of at least 18 gigawatts (GWs) to service AI's data centers by 2030. New York City's grid is about 6 GW annually, so the grid needs about three Big Apples' worth of capacity to satiate AI's energy needs.

Intermittent sources, such as wind and solar, cannot meet that need. They are also costly to build for the small amounts of MWh they provide, and the landmass needed to have a capacity comparable to nuclear is extensive. What would take around 15 square miles of solar, nuclear can do in one—and those 15 square miles of solar would produce power only sometimes, while the one square mile of nuclear provides power around the clock.

Nuclear provides baseload power: the constant, uninterrupted, adequate supply of energy that keeps grids humming.

Nuclear is the most reliable zero-carbon-emitting energy source currently available, which is why tech companies are growing fond of it. Amazon recently announced a $500 million investment in small modular reactors in Virginia and Washington. Google will finance seven small-scale reactors using molten fluoride salt instead of water. Though not as bullish as its competitors, Apple has quietly added nuclear as part of its sustainability goals.

"Nuclear energy, if we do it right, will help us solve our climate goals," Microsoft co-founder Bill Gates told ABC last year. "That is, get rid of the greenhouse gas emissions without making the electricity system far more expensive or less reliable."

"This trend isn't just another market blip—it's part of a larger movement that has far-reaching implications for investors, especially as we enter the age of artificial intelligence," writes Frank Holmes, CEO and chief investment officer of U.S. Global Investors. "Nuclear energy truly appears to be staging a major comeback."

Private capital investment in nuclear energy has skyrocketed in recent years. The value of nuclear investments jumped from $12 million in 2015 to $1.1 billion in 2022—a 9,000 percent increase.

While nuclear power's rise is a positive trend for reliable energy, removing equally reliable and affordable hydrocarbons from the grid is a scientific and economic impossibility. And though this influx of investment signals a new age for nuclear energy, it also highlights persistent market barriers. Nuclear power is capital-intensive, and the cost of market entry remains high. Constructing new plants is exponentially more expensive than keeping existing facilities online—and government regulation is often to blame. 

Strangled by Red Tape

In the wake of the TMI meltdown, government fines and permits made nuclear power plants substantially less profitable. Regulations have inflated the time and cost needed to plan, build, and maintain a new nuclear power plant. Paperwork, fees, and other compliance-related expenditures can add up to $60 million in annual costs for the average American nuclear plant.

Time is money, and few projects require more time than nuclear ones. The global median construction time ranges from 7.5 to 11 years, depending on the sample size. The average construction time in Germany, France, and Russia is about 80 months (nearly 7 years); in Japan, it is about 60 months (about 5 years).

But in the United States, the process is much longer. The Nuclear Regulatory Commission (NRC), the federal agency responsible for regulating civilian nuclear use, is notoriously restrictive. Even a minor plan tweak requires additional NRC approval, often causing significant delays. Southern Company started construction on its newest reactors in 2009. After 14 years and several rounds of redundant regulatory review and approval, both reactors came online in the summer of 2024—seven years past the originally planned start date and more than double the original budget.

When factoring in both permitting and construction, the final completion of American nuclear plants can surpass 20 years. Considering the time and cost, it's no wonder so many investors are too spooked to jump into the new nuclear game.

This domestic scarcity has resulted in a sizable international disparity in new nuclear development. As of July 2024, China leads globally with 25 reactors under construction, followed by India with seven, then Turkey, Egypt, and Russia with four apiece. Meanwhile, the United States has no new reactors or plants currently under construction.

To justify this regulatory overreach, nuclear skeptics cite safety concerns. Yet the nuclear industry's safety record is unmatched—and not because of those regulations. Even before the TMI incident (which released minimal radiation), nuclear energy's record was nearly flawless. From 1957 (when the first nuclear reactor in the United States began operations) through TMI's partial meltdown, only one other accident occurred: the Argonne explosion of 1961, which killed three employees. By comparison, 4,860 people died in coal mines during the same time.

The Return of Three Mile Island 

Today, Three Mile Island signals a new direction for affordable, reliable, and abundant energy.

When the plant initially closed in 2019, state lawmakers flirted with a $500 million taxpayer-funded bailout. Fortunately, that bill failed to get out of committee. Instead, on the fifth anniversary of the closure, Constellation Energy and Microsoft announced a partnership to bring the plant back online.

Under the 20-year agreement, Constellation will refire the plant's undamaged reactor, which closed in 2019, and sell energy directly to Microsoft. The tech giant, in turn, will power its growing artificial intelligence needs with around-the-clock energy.

Though not purely market-driven (Constellation recently applied for a federal loan), the TMI plans are a stark contrast with industrial policy's track record. The Inflation Reduction Act, passed in 2022, included tax credits for nuclear development projects, starting at 30 percent and rising to 50 percent if they meet more stringent criteria. Yet these financial incentives didn't work: Despite those credits, there has yet to be a rush to build new reactors or revitalize old sites. TMI is one of just two pending nuclear projects in the United States.

Fortunately, some lawmakers and public officials recognize the true problem: excessive regulations.

President-elect Donald Trump has signaled that energy permitting reform is "the path to U.S. energy dominance." The Trump administration has also tasked the newly formed National Energy Council, a blue-ribbon committee designed to boost energy production, with winning "the AI arms race" with China, emphasizing the importance of deals like the Constellation-Microsoft agreement. Chris Wright, Trump's nominee to energy secretary, is "a "huge nuclear fan." Vivek Ramaswamy—who will help run the Department of Government Efficiency, a nongovernmental group dispensing advice on potential cutbacks—has expressed antipathy for the NRC, calling it "the wet blanket" of innovation in the nuclear industry.

Pennsylvania lawmakers are also working to speed up the regulatory process. Democratic Gov. Josh Shapiro requested that PJM Interconnection—the grid operator for his state, 12 other northeastern states, and the District of Columbia—allow TMI to skip the "regulatory queue." Shapiro's request emphasized "rapid entry of projects that can quickly begin adding capacity to the grid." Considering Constellation's ambitious goal of bringing TMI back online in three years, time is of the essence.

Shapiro's urgency is understandable. In addition to adding reliable energy, project developers estimate that TMI will create 3,400 jobs (many of which pay 45 percent more than the state's median salary), $3 billion in state and federal taxes, and a $16 billion boon to Pennsylvania's GDP.

With the nation's growing electricity consumption and increasingly fragile grid, the United States faces a choice: build more reliable energy capacity or deindustrialize. The Jane Fondas of the world may welcome the latter, but the rest of the country would prefer to keep their homes warm this winter and air conditions running this summer. 

To do that, we need more Three Mile Islands.